Korea Pizza Hut, which has entered the corporate rehabilitation process, will eventually start selling its brand goodwill.

According to the investment bank (IB) industry on the 27th, it has been confirmed that Pizza Hut Korea submitted an application to the Seoul Rehabilitation Court for permission to select a manager for the sale of mergers and acquisitions and initiate procedures. The company's plan submitted to the court on the same day reportedly includes plans to pursue M&A, including the continuity of the Pizza Hut brand and franchise operations and the acquisition of third parties or transfer of goodwill to secure liquidity for bond repayment.

If the rehabilitation court permits the start of the selection process for a manager submitted by Pizza Hut Korea, it will take steps to sell the brand through procedures such as selecting a manager, receiving letters of intent to acquire, and bidding publicly.

On the same day, Pizza Hut Korea officially announced that it will begin the M&A process by sending CEO letters to more than 300 merchants and suppliers nationwide along with the submission of the permit application. In an official letter under the name of Cho Yoon-sang, CEO of Pizza Hut Korea, the company explained, "We have submitted a plan to the court to proceed with the rehabilitation process by M&A based on the judgment that it is urgent to complete the rehabilitation process quickly for the protection of brand value and the business continuity of franchisees."

Earlier, in September last year, Korea Pizza Hut lost the second trial of a lawsuit filed by some franchisees for the return of unfair gains, the so-called "difference guarantee" lawsuit. When the company's account was seized along with a ruling to return 21 billion won, it applied to the Seoul Rehabilitation Court in November last year to initiate corporate rehabilitation procedures. The rehabilitation plan must be submitted to the court by May 21.

Pizza Hut Korea seems to have chosen the most aggressive way to sell the company to a third party by attracting investors, including the sale of brand goodwill, to raise debt payments.

Korea Pizza Hut is currently undergoing an appeal process at the Supreme Court in connection with a lawsuit for the return of unfair gains.

[Reporter Oh Dae-seok]